Comptroller John C. Liu announced yesterday that the office uncovered a half-million dollars in suspected pension fraud. The office discovered the fraud after finding numerous instances of dead retirees continuing to cash their pension checks. Of course this brings up the possibility of ghosts and/or zombies who have figured out how to use modern ATMs, but we'll go with the fraud bit for now.
Comptroller Liu said, "This suspected pension fraud wastes the public’s money and undermines security for the city’s workers and retirees. Moreover, it fuels cynicism and distrust about public pensions, unfairly stigmatizing hardworking employees and retirees who have dedicated years of service doing the right thing for the city." Liu found 14 specific cases of people continuing to cash a dead pensioner's checks, and 171 other cases in which pension payments were issued to deceased pensioners between 2007 and 2009. In one case, a suspect used a dead pensioner's drivers license to cash 38 checks totaling $139,818 between 2007 and 2010, even renewing the license when it expired.
Department of Investigation Commissioner Rose Gill Hearn said, "We will fully investigate the allegations that the Comptroller has now referred to us—specifically, 14 instances where pension payments were made after the deaths of the retirees and where no surviving beneficiary can be identified—and we will take appropriate action, which may include arrests, based on the evidence." Last year the city spent $6.6 billion in pension-related costs. Next year, it's expected to climb to $7.8 billion.